- GBP/JPY holds positive ground near 200.10 in Tuesday’s early European session.
- The UK Unemployment Rate rose to 4.4% in three months to April; Claimant Count Change arrived at 50.4K in May.
- Analysts expect the BoJ to commence tapering its monthly bond purchases at Friday’s policy meeting, according to Reuters polls.
The GBP/JPY cross trades in positive territory for the third consecutive day around 200.10 during the early European session on Tuesday. The cross dropped a few pips on mixed UK employment data. Investors will shift their attention to the Bank of Japan (BoJ) monetary policy meeting on Friday.
The latest data from the UK Office for National Statistics on Tuesday showed that the ILO Unemployment Rate rose to 4.4% in the three months to April from 4.3% in the previous reading, worse than the market expectation of 4.3%. Meanwhile, the number of people claiming jobless benefits rose by 50.4K in May from an increase of 8.4K in April. The UK Employment Change came in at -140K in the three months to April, versus a -177K decrease in the previous reading.
Apart from this, the UK Average Earnings excluding Bonus rose 6.0% 3M YoY in April, compared to a 6.0% increase in March, beating the estimations. The Average Earnings including Bonus increased by 5.9% in the same period and above the consensus of 5.7%. The Pound Sterling (GBP) attracts modest sellers in the immediate reaction to the mixed UK employment market data.
The BoJ is expected to commence tapering its monthly bond purchases at Friday’s policy meeting, according to nearly two-thirds of economists surveyed in a Reuters poll on Tuesday. The Japanese central bank is widely anticipated to keep its short-term interest rate unchanged at 0.0%–0.1%. Investors will closely watch the BoJ’s statement. The dovish tone from the BoJ might exert some selling pressure on the Japanese Yen (JPY) and create a tailwind for the GBP/JPY cross.
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